As a result of the national debt ceiling issue, Moody’s Investors
Service recently placed the Aaa bond rating of the U.S. government on
review for possible downgrade. Subsequent to this action and as a
result of Moody’s contention that the economies of both the commonwealth
of Virginia and Fairfax County are closely aligned with the federal
budget and therefore vulnerable to dramatic changes to federal contracts,
leasing and employment, Moody’s placed both the commonwealth and Fairfax
County’s bond ratings on review for possible downgrade.

This action belies the strength and diversity of the county’s
economy, which has long been cited by the leading credit rating agencies
as evidence of its top rating of triple-A (“Aaa”). As
recently as July 6, Moody’s praised Fairfax County’s strong budgetary
control of spending, funding of long-term liabilities and conscientious
reliance on a number of self-imposed financial and debt management
guidelines as it reaffirmed the county’s credit rating.

Fairfax County’s continued strong fiscal management and low overall
debt burden brings stability in uncertain national economic times. In
addition, through careful fiscal planning and the continuous
application of the Ten Principles of Sound Financial Management
adopted by the Board of Supervisors 36 years ago, the county has
held a Aaa rating from Moody's Investors Service since 1975, an AAA
rating from Standard & Poor's since 1978, and an AAA rating from
Fitch Ratings since 1997. As a result of these superior ratings,
the county has saved over $486.3 million since 1978 on bond and refunding
sales.

Fairfax County has a strong history of taking decisive actions to meet
its financial obligations. It has weathered projected deficits, taken
programmatic reductions and eliminated positions to ensure an annual
balanced budget.

Fairfax County does not borrow for its operating budget and its policies
ensure that reserves fund the costs of planned replacement of major
equipment or infrastructure over several years. Fairfax County has a
well-structured plan in place to balance the need for public facilities
with the fiscal capacity of the county to provide for those needs.

Fairfax County’s recent success in the bond market occurred even when
municipal interest rates were volatile due, in part, to the economic
situation and the federal budget and debt crises. The competitive
sale of the county’s bonds illustrates the value of the county’s AAA
ratings as investors and underwriters acknowledged Fairfax County as a
leader in a turbulent market.

As they reaffirmed the county’s top ratings within the last year, all
three rating agencies cited the county’s self-imposed financial and debt
management guidelines as a strength.

Fitch noted the county’s “stable financial performance, based on the
county’s continued adherence to sound financial management practices,
conservative budgeting, and proven ability to respond to changes in its
operating environment.”

Moody’s indicated that “in spite of ongoing budgetary challenges, the
County continues its practice of strong budgetary control of spending,
funding of long-term liabilities and a conscientious reliance on a
number of self-imposed financial and debt management guidelines.”

Standard & Poor’s said, “The county’s strong financial management
practices have helped it manage through strong periods of growth as
well as economic slowdowns while maintaining what we consider a strong
and stable financial profile.”

Despite many competing county needs that deserve funding during this
challenging economic time, Fairfax County balanced its budget by making
tough choices among competing priorities, adhering to risk averse,
time-tested policies and engaging in highly successful, long-term fiscal
strategies. There are no plans to change the way major projects are
financed; the federal budget and debt crises will be addressed by
monitoring the situation and making adjustments as the markets
respond.Fairfax County has a proven track record of doing what has been
necessary to balance budgets every year, maintain essential services and
adjust capital programs to meet recessionary challenges.

Fairfax County has a robust business community with a strong,
diversified economy. In July, Moody’s noted, “positioned for long-term
stability, the county’s economy is diverse with considerable commercial
activity including high-technology, telecommunications, defense, health
care and financial services firms.”

Following are key indicators of the strength of the county’s economy:

Home values have increased in each month of 2011 compared to the same
month in 2010. The Washington area is the only large metro area
that has experienced gains in home prices during 2011.

Fairfax County has experienced job growth since the spring of 2010. At
the end of 2010, 11,800 jobs had been created in the county. The
unemployment rate of Fairfax County residents is just 4.3
percent.

In 2010, 154 companies announced that they would locate or expand
business operations in the county and create more than 6,400 jobs — in
contrast to communities around much of the country that struggle to
hang on to employers and jobs.

In 2010, Fairfax County had the highest percentage of jobs — nearly 34
percent — in technology industries of any county among the major U.S.
technology markets, based on Bureau of Labor Statistics/Virginia
Employment Commission data on unemployment insurance-covered jobs.

With more than 113 million square feet, Fairfax County is the
second-largest suburban office market in the nation.

The county has more companies on the Fortune 500 than 30 states. The
revenue of these Fortune 500 firms — which represent a range of
industries — account for 53 percent ($129.3 billion) of the revenue
production of all of Virginia’s Fortune 500 companies.